Want More Than $9 Corn Prices? Go to China

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More than $9 a bushel is the new government support price in China for corn, far above the market prices earned by American farmers.

Import implications. USDA's Economic Research Service (ERS) said China's high domestic support prices for grains and other commodities have played a major role in boosting imports of much-cheaper US commodities. Link to ERS report.

The Chinese government this year also raised the support price for early-season indica rice by 10 percent to encourage more domestic production, but the increase served to encourage Chinese mills to use more imported rice.

China's farm subsidies also may have encouraged imports, ERS said, by creating more demand for inputs such as commercial seed, raising their prices and thereby boosting Chinese farmers' production costs.

Perspective: U.S. farm exports to China reached $26 billion in 2012, up from $5 billion in 2003.

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.